LG Electronics reported record high sales for the second quarter on Wednesday due to strong sales of LCD TVs and mobile phones, including its popular Cookie touchscreen smartphone.
The South Korean giant said sales increased 13.8 percent over the same time last year to 14.50 trillion Korean won (US$11.63 billion). Net profit climbed 62 percent to 1.15 trillion won.
The earnings report adds to growing optimism in the technology sector that the worst of the global recession may be over. A number of technology companies, including Intel, Apple and IBM have recently announced quarterly earnings that handily beat analysts' expectations.
LG was affected by the global slump in some divisions, including home appliances. "Continuing problems in the housing market slowed the pace of recovery of the home appliances industry. ... Looking at the third quarter, market demand is expected to shrink year-on-year due to the ongoing recession but the decline in the market is expected to slow down," it said.
Sales of technology gear provided the main boost to LG's earnings, the company said.
The company shipped a record high number of LCD TVs during the three month period, 4.28 million compared to 2.96 million during the same quarter last year. LG credited an aggressive strategy of launching new models for the 51 percent year-on-year growth in shipments. LG expects sales momentum to continue in the third quarter, the high season for new TV sales every year, and said the addition of LED (light emitting diode) LCD TVs to its product line-up will help it expand market share.
LG's mobile phone shipments grew in the second quarter due to the launch of new models and growth in sales of some existing mid-and higher end handsets, the company said. Mobile phone shipments rose to 29.8 million in the second quarter, up 8 percent year-on-year and 32 percent higher than 22.6 million in the first quarter.
LG said it had seen strong demand for models such as its full touchscreen Cookie phone, LG-KS360 QWERTY keypad messaging phone and other handsets. The company expects third quarter shipments to be strong due to the introduction of high-end smartphones such as the fourth model of the LG Black Label Series and other handsets.
The company predicts global handset shipments will decline 6 percent year on year to around 280 million mobile phones, but that its own shipments will continue to grow.
LG's net profit was boosted by an investment gain from its stake in LG Display of 112 billion won, as well as a foreign currency exchange gain of 286 billion won, and a gain from overseas subsidiaries of 461 billion won, the company said.